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Androclus Therapeutics Announces Completion of First Institutional Financing

Monday, May 16, 2005

SAN DIEGO & MILAN, Italy (Business Wire) -- Androclus Therapeutics announced today that it has completed a first institutional financing round to advance its product development programs in rheumatoid arthritis, multiple sclerosis and inflammatory bowel disease.

Two investors, E. de Rothschild Investment Partners and Matignon Technologies, led the financing. Individual investors among existing shareholders also participated.

Michele Ollier of E. de Rothschild Investment Partners and Guillaume Connan of Matignon Technologies have been elected to the Board of Directors. They join Salvatore Albani, M.D., Ph.D., of University of California San Diego, who serves as Chairman of the Board, Igor Bilinsky, Ph.D., CEO of Androclus Therapeutics Inc., Lorenzo Boscarelli, Managing Director of Androclus Therapeutics S.p.A., and Silvano Fumero, Ph.D., of Creabilis Biotech.

Androclus is developing a new generation of therapeutics for the treatment of autoimmune diseases. Androclus' leading drug candidate AT-001 is an orally administered immunomodulatory peptide for the treatment of RA, currently in a Phase II clinical trial that will be completed in the summer 2005. Compounds for the treatment of MS and IBD, based on the same technology platform, are expected to enter clinical trials within one year.

"The first institutional financing is an important step in the evolution of Androclus Therapeutics and will enable Androclus to further develop its programs in multiple sclerosis and inflammatory bowel disease. We are very pleased to have Rothschild and Matignon as the first venture investors in the company," said Igor Bilinsky, Ph.D., CEO of Androclus Therapeutics Inc.

"We believe that Androclus is the company that is best positioned to demonstrate efficacy of an epitope specific technology in the field of autoimmune diseases. The quality of Prof. Albani's science, the ability of the management to attract support of key experts in product development, and a major biotech as a partner provide significant competitive advantage to Androclus. The results of the ongoing Phase II study in rheumatoid arthritis will be available soon and will mark a major milestone in validation of the technology," said Michele Ollier of E. de Rothschild Investment Partners.

"We are delighted to support Androclus in its future development. We believe AT-001 could rapidly change the RA market outlook while other products in development and the technology itself are potential breakthroughs. The company has reached this level of maturity without venture funding ... which is a clear evidence of the quality of its management team," said Guillaume Connan of Matignon Technologies.

Androclus plans to raise the next financing round in Q4 2005, to follow an announcement of AT-001 Phase II results. The proceeds will be used for clinical development of MS and IBD drug candidates, advancement of the technology platform and building a deep discovery pipeline.

About Androclus Therapeutics

Androclus Therapeutics is a private clinical stage biotechnology company developing a breakthrough Epitope Specific Immunotherapy technology platform and novel therapeutics for the treatment of autoimmune and inflammatory diseases, including rheumatoid arthritis, multiple sclerosis and inflammatory bowel disease.

Androclus' leading drug candidate is an orally administered peptide AT-001 (dnaJP1) for the treatment of RA. AT-001 is currently in a Phase II clinical trial that will be completed in Q3 2005. A previously completed open-label Phase I/IIa demonstrated safety, biological efficacy and trends of clinical efficacy. Androclus has partnered AT-001 with a large biotechnology company.

Building on the experience with AT-001 and using the same technology platform, Androclus is developing orally administered peptide therapeutics for the treatment of MS and IBD, with INDs for both indications expected within one year.

Compared to existing biologics for the treatment of autoimmune diseases, Androclus' drug candidates are expected to offer a complementary approach, be more selective in targeting autoimmune inflammation, have a better safety profile and a more convenient oral route of administration.

About Edmond de Rothschild Investment Partners

Edmond de Rothschild Investment Partners manages over 220 million euros dedicated to venture capital and capital growth investments. The investment team is made up of seven professionals with over 40 years of experience in private equity and 30 years in industry. E. de Rothschild Investment Partners manages FCPR and FCPI capital growth and life science venture funds.

About Matignon Technologies

Matignon Technologies is the venture arm of Matignon Investissement & Gestion (MIG), a French independent private equity house managing over EUR 200 million. Matignon Technologies invests both in early-stage life sciences and information technology high growth companies.

Androclus Therapeutics, San Diego
Dr. Igor Bilinsky, CEO, 858-909-0020
info@androclus.com
www.androclus.com
or
E. de Rothschild Investment Partners
Michele Ollier, +33 1 40 17 69 48
or
Matignon Technologies
Guillaume Connan, +33 1 53 53 98 10